1987 Reports

Japan's industrial structure in crisis: National concerns and international implications

Patrick, Hugh T.; Rosenbluth, Frances

The purpose of this essay is to summarize and distill the informative presentations and lively discussion of a conference that was held on the Japanese industrial structure. Japan now faces the challenge of the third period of major restructuring of its economy since World War II. The first involved the reconstruction of Japan's war-torn economy and its transformation to civilian goods production. The second restructuring was in response to the huge, unexpected oil price hikes, especially in 1973-74 but also in 1979-80. The current transformation is in direct response to the unprecedentedly great appreciation of the yen from its low point in early 1985. Japan now faces the combined pressures of a stronger yen, competition from newly industrializing countries and other low-cost producers, and continued demands from its trading partners to reduce its continuingly huge current account surpluses.